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Allegiant: Looking To Sell Tickets That Could Increase Price

Leeds, United...
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Allegiant: Looking To Sell Tickets That Could Increase Price

Allegiant are looking into the feasibility of selling tickets that could increase in price after you have purchased one. This is due to the increase in fuel prices.

Not sure what anyone's take on it is here, to me it doesn't seem like a good idea. It certainly seems like one way of getting customers to use alternate methods of travel.

I wonder what would happen if someone had a confirmed ticket, and when they turned up at the airport for checkin were advised they had to pay more but didn't have the funds to pay any extra?

mlive.com/business/west-michigan/index.ssf/2…

Bangkok
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1. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

Hi,

Interesting idea to say the least.. I can see some possible gains and losses for both sides here..

For the airline--

They are effectively transferring the fuel price risk from themselves and placing it with the passenger.. and with acceptance of the risk should come the possibility for rewards..

So *if* a passenger bought one of these variable fares .. and the price were to rise, the passenger would be hurt and the airline would be able to collect the then-fare in place.. but.. to be fair as well... should the fare drop, the passenger would now win and the airline would have to refund part.

So, theoretically, the risks are pretty much equal for both parties in that each party bears downside potential risk/losses and the gains/losses are diametrically opposed:

For the airline: Lower fares thus requiring a refund, and

For the passenger: Higher fares thus requiring an additional fare payment.

... and they both bear equal risks for some potential upside gains as well:

For the airline: Higher fares thus requiring an additional passenger payment.

For the passenger: Lower fares, thus requiring a prorated refund.

Operationally, I think this might possibly work for a smaller carrier or regional one, but for major network carriers, I can see sizable logistical issues and staffing needs to address and handle all the re-pricings that may occur..

Travel Safe,

Edited: 04 March 2011, 01:27
Newcastle, Australia
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2. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

My biggest question is how long would it take to issue a refund in the event one was due? Many here have horror stories about getting a refund and the crazy amount of time it can take.

Elk Rapids, Michigan
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3. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

Might work if they do one thing, not have you pay until you travel. As it is you book way ahead of time and you have to pay for it so they get to sit on that money til you fly.....earning interest I assume.

San Diego
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4. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

It is similar to what cruise ships say in the contract when you book.

They tell you that they can add on an extra fuel charge if the price of oil goes above a certain no.

LON-SIN
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5. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

Cant airlines buy options on fuel to garauntee the price of fuel for say the next 9 months?

Bangkok
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6. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

Hi,

Yes they can, and in most cases they do.. but those future contracts have also risen as the underlying (Jet A) commodity price has risen as well.

So, while they can partially cap their fuel costs in the short to medium term, the costs to do that is also in play.. and the other point is that *if* they do buy futures and the price subsequently falls, they are now beholden to honor that contract and buy at the locked in higher price than at spot/market prices.

Travel Safe,

UK
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7. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

Should this happen, there will be posters here saying "I booked a variable price ticket on Allegiant that could go up in price, and what do you know, when I turned up at the airport, it went up in price. Thats outrageous, it just as bad as the time I booked a nonrefundable ticket and they didnt refund me! "

In any case, I think such a scheme would be an administrative nightmare and unlikely to proceed.

Berkeley, CA
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8. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

There is no way in the world that this idea would benefit passengers, despite Gopbi's reasonable analysis. If it could benefit passengers it would not have been proposed. An industry that imposes, for example, "contract" terms that allow it to change or cancel flights without regard to the passengers interest, but doesn't allow passengers to make even minor changes months in advance without the payment of onerous penalties, is not an industry that will wind up paying refunds to passengers because the price of fuel goes down.

This board, as a forum for nonprofessional travelers, as contrasted to Flier Talk, could provide a public service by giving passengers a place to complain about and publicize the anti consumer rules that passengers are forced to accept. Unfortunately, some of the most active participants on this board seem more concerned about whether the passenger strictly adhered to the unfair conditions than they are about the conditions themselves. If given any opportunity, they will insult and bully those posters, ensuring that they will never return, and their concerns are trivialized.

UK
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9. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

<<Unfortunately, some of the most active participants on this board seem more concerned about whether the passenger strictly adhered to the unfair conditions than they are about the conditions themselves.>>

I agree many Ts&Cs are lopsided and unfair, but this isn't a campaigning site, or a site where people gather round and give tea and sympathy*, if you want that set up your own website or a facebook group.

What people generally get here is a frank appraisal of the situation as it is, not as it might be in some future utopia.

* Sometimes for ignorance thats understandable given the complexities, but often frankly for people's own idiocy.

Edited: 05 March 2011, 08:20
10. Re: Allegiant: Looking To Sell Tickets That Could Increase Price

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